Question
Problem 3 The comparative balance sheet for 2020 and 2019 for Jackson Corporation as well as additional information concerning transactions and events during 2020 are
Problem 3
The comparative balance sheet for 2020 and 2019 for Jackson Corporation as well as additional
information concerning transactions and events during 2020 are presented below:
Jackson Corporation
Balance Sheet
December 31, 2020 and 2019
20202019
Cash$35,900$10,200
Accounts receivable (net)48,30020,300
Inventory35,00042,000
Long-term investments015,000
Property, plant & equipment236,500150,000
Accumulated depreciation(37,700)(25,000)
$318,000$212,500
Accounts payable$19,000$26,500
Accrued liabilities19,00017,000
Long-term notes payable70,00050,000
Common stock130,00090,000
Retained earnings80,00029,000
$318,000$212,500
Additional data:
(a) Net income for the year 2020 was $90,000.
(b) Depreciation on plant assets for the year was $12,700.
(c) Sold the long-term investments for $33,000 (at a gain of $18,000).
(d) Paid dividends of $39,000.
(e) Purchased machinery costing $26,500 and paid cash.
(f) Purchased machinery and gave a $60,000 long-term note payable.
(g) Paid a $40,000 long-term note payable by issuing common stock.
Required:
Using the indirect method, create a statement of cash flows for 2020 for Jackson
Corporation.
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